Alibaba's Ant Financial May Have Won the Bidding War for MoneyGram After Upping Its Offer to $1.2B

Thanks to a bidding war started by Euronet, Alibaba’s Ant Financial has upped the ante for the purchase of the second largest money transfer operator in the U.S. at $1.2 Billion. The new purchase price is reported by Tech Crunch to have the approval of Money Gram’s board:

The firm initially bid $880 million for MoneyGram back in January, but now it has increased its offer from $13.25 per share for NASDAQ-listed MoneyGram to $18.00 following a counter bid from Euronet lodged in March. Euronet, which is also based in the U.S., offered $1 billion and played up concerns around the potential for MoneyGram to be acquired by a Chinese company — Ant Financial, which operates Alipay, China’s largest online payment provider.

Ant Financial’s new offer — which represents a 64 percent premium to MoneyGram’s average share price prior to the announcement of the first offer — has been unanimously approved by MoneyGram’s board, while a collection of shareholders who own 46 percent of voting rights have also given it the nod

Alibaba to date has been interested in creating an acceptance network for its Chinese customers who travel to the U.S. and would like to use AliPay for purchases. This would be the means of acquiring U.S. based customers in addition to established agents in south-east Asia.This deal is not quite final as it still needs to secure government approval:

On its side, Ant Financial said it has “already made significant progress towards obtaining the regulatory approvals necessary to complete the transaction.” That apparently includes anti-trust clearance in the U.S. and some state-level approvals, too. One major hurdle remaining is approval from the U.S. Committee on Foreign Investment. That’s an area where Euronet will hope the deal trips up. However, Jack Ma has already put in work meeting U.S. President Donald Trump — who would have final say over the deal — and pledging to create jobs in the U.S., a claim that Ant Financial repeated

Overview by Sarah Grotta, Director, Debit Advisory Service at Mercator Advisory Group